Trading with point and figure

Dentalfloss · Mar 12, 2019

Dentalfloss · Mar 12, 2019

will that hold..??
11600 rez area

Dentalfloss · Mar 12, 2019

gettin near our 11560
stops tight

Dentalfloss · Mar 12, 2019

we iz there

Dentalfloss · Mar 12, 2019

needs to stay above the line

Dentalfloss · Mar 12, 2019

and bounce

Dentalfloss · Mar 12, 2019

stops tight

Dentalfloss · Mar 12, 2019

stopped out
excellent run

Dentalfloss · Mar 12, 2019

stopped out
decent few

Dentalfloss · Mar 12, 2019

lined up

Dentalfloss · Mar 12, 2019

Cable
lookin decent..so far

Dentalfloss · Mar 12, 2019

Good Morning: The Long & the Short of it and The Bigger Picture - 12 March 2019 - ADM ISI

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Ostwald, Marc
08:49 (6 minutes ago)

to Marc

- Brexit vote in focus: digesting Oz Housing Finance and upbeat comments
from China stats bureau chief ahead of Thursday's reports; UK GDP and
run of monthly activity and trade data on tap ahead of US NFIB Small
Business Optimism & CPI; India Industrial Production and CPI; EcoFin
meeting; US 10-yr auction

- UK Brexit vote: agreed additions more a case of muddying of legal
backdrop, Cox opinion potentially pivotal, but WA still looks likely to
be defeated without shift from a substantial number of Labour MPs

- UK: Jan GDP and other activity indicators seen rebounding from December
slump, albeit tepidly

- US NFIB Small Business Optimism: seen rebounding modestly, some upside
risks given scale of Consumer Confidence rebound

- US CPI: very "average" m/m gain expected, some upside risks for headline
from gasoline/energy prices, but unlikely to jar Fed 'patience'

- Morning Call audio file:
https://www.mixcloud.com/MOstwaldADM/adm-isi-morning-call-12-march-2019/

- Chart: GBP/USD 10, 30 & 90 day historical volatility

..........................................................................

********************
** EVENTS PREVIEW **
********************

It is a measure of the sheer scale of the farcical tragedy that Brexit has become that it remains very unclear what the outcome will be with just 17 days to go, but it is this that will be today's main talking point, even if there is a reasonably busy run of data and other events on the schedule. The latter has the Q2 Manpower Employment surveys, which bear considerable scrutiny given the (self-serving, myopic?) financial market 'doom and gloom' narrative about the global economic outlook. In that respect, it is well worth noting the upbeat comments on January/February activity data (due Thursday) from the China stats bureau chief, who noted a pick-up in activity, which is not what the consensus forecasts are assuming. There are also Australia's mortgage lending data (down again, though a little less than forecast) to digest ahead of Swedish CPI, the raft of UK monthly activity data, and Indian CPI and Industrial Production. While the US looks to the NFIB Small Business Optimism survey ahead of its CPI report. The events schedule beyond that UK Brexit vote has an EU EcoFin meeting, some macro-prudential ECB speak from Enria and Lautenshclaeger, and the continuation of US CERAWeek energy conference. In govt bond supply terms, the US re-opens the current 10-yr to the tune of $24 Bln.

** U.K. - Jan GDP, Index of Services, Industrial Production and Trade Balance & Brexit vote **
While all eyes will be on the Brexit vote(s), Tuesday also sees a raft of monthly activity data for the UK, which is likely to confirm that the economy is running only just above stall speed. January monthly GDP and the key Index of Services are seen rebounding 0.2% m/m after dropping 0.4% and 0.2% in December, and a similar bounce is anticipated for Industrial Production and Manufacturing Output after falling 0.5% and 0.7% in December, with the erratic Construction Output measure forecast at 0.8% m/m (Dec -2.8%). The Trade deficit is seen barely changed, while the RICS House Price Balance is expected to remain at rather dire levels -24 from Jan -22.

In terms of the UK Brexit vote in parliament, are the addenda to the original 'Withdrawal Agreement' (see: https://ec.europa.eu/commission/pub...union-and-european-atomic-energy-community_en ) going to be a game changer? We initially await to see if the Attorney General Cox agrees that the codicils are really legally binding, but in truth the wording of the various elements is highly contingent, and subject to arbitration and 'best endeavours'. Thus the UK 'could' unilaterally withdraw from the 'backstop' if the EU were judged to be 'forcing' it to remain in the Customs Union, but this would be subject to the ECJ, and indeed the Vienna Convention on Treaties. Additionally it relies on 'alternative arrangements' being established by the end of 2020, which given the obvious intractability on both sides looks to be the stuff of illusion. As importantly the Juncker letter stresses that the Brexit process must be completed by the May 23-26 European Parliament elections, otherwise the UK will be legally require to hold those elections, and it is very clear that there will be no third vote on the Withdrawal Agreement. A realistic assessment of the likely vote outcome suggests that it still faces defeat by some 100-140 votes, and for it to pass will above all require a major shift by Labour MPs, which seems unlikely. If it does fail, then a vote on 'No Deal' Brexit is scheduled for tomorrow, and if that fails a vote to extend Article 50 is scheduled for Thursday. The possibility of all votes failing cannot be ruled out, leaving the UK looking 'ungovernable' and implying that the only way to break the deadlock would be to force May's resignation and then try to force a vote to call a General Election, though even that might fail. It should of course be reiterated that even if the Withdrawal Agreement is passed, this is merely a stepping stone to starting negotiations on what form of trade arrangements with the EU and the rest of the world will look like post Brexit, i.e. much uncertainty will remain.

** U.S.A/.- February CPI
- CPI is expected to rise a very 'average 0.2% m/m to be unchanged at 1.6% y/y headline and 2.2% y/y core. In headline terms, the rebound in gasoline and energy prices imparts some upside risks to the headline, while the rise in core CPI will likely be paced by ongoing upward pressures in housing (OER) and medical care. Be that as it may, even an upside surprise is not going to shift the FOMC view, as re-emphasized by Powell in his Sunday TV interview, that it can be patient for a protracted period (at the very very least Q3), as it assesses international developments. The NFIB Small Business Optimism precedes CPI and bears some scrutiny, given that sub-indices on Orders, employment, compensation and investment intentions remain robust on any historical comparison, and have not fallen as much as the headline index, which is seen at 102.5 vs. January 101.2, with risks to the upside if the Consumer Confidence rebound is any guide.